Low inflation to encourage India central bank to cut rates next week

BENGALURU: The Reserve Bank of India is expected to cut interest rates when it meets on Aug 2, responding to an inflation rate running well below target, but an improving economy is likely to keep it on the sidelines for a long time thereafter, a Reuters poll showed.

A significant moderation in retail inflation over the past three months has reinforced calls for further monetary policy easing from the central bank, which changed its stance to neutral from accommodative at the start of the year.